Australian energy production by fuel mix

For the 3 months to 25 January 2023, the Australian energy market operator reports the following supply sources.

Source: aemo.com.au

These three months are typically the best for sunshine and reasonable winds. Yet solar and wind generation are contributing only 20% of the country’s needs.

It seems to me that the only viable way to get the penetration of renewables up will be to shut down all coal and gas production. Then renewables would be close to 100%. An inconvenient side effect would be that we would have only a quarter of the energy that we have today.

Market failure?

Oh dear. The Australian Energy Market Operator has suspended the market. The Operator says the market was “impossible to operate”. Does this constitute a market failure? It’s definitely a failure of something.

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I say it’s not a market failure. That’s because it’s not a real market. The authoritarian left often decries market failure as reason for Government intervention in all manner of ways. Well, here’s an example of a highly restricted and distorted pseudo market failure right in front of our eyes at a time when the energy supply is tottering on the verge of blackouts.

The reason for this failure is precisely due to years of Government intervention, mismanagement and lies. Goodness knows what happens from here, but mark June 2022 as the month in which the creaking facade masquerading as an energy system in Australia crumbled.

Energy production in Australia

Update from 17 June, 5:30 pm AEST: coal and gas are currently producing 78% of Australia’s electricity supply.

We need more renewables, obviously. Look at the contribution to Australia’s energy supply over the last 48 hours. After decades of subsidies to promote windmills, solar panels, hydro schemes and biofuels, the total output of renewable sources is woefully tiny. Not enough subsidies, I expect.

Source: Australian Energy Market Operator

Give the customers what they want

The best way to succeed in business is to give the customers what they want. This announcement from Rio Tinto clearly pleases one campaigner from the Conservation Foundation, but I’d be surprised if she is a Rio customer.

Source: Australian Financial Review

Rio customers looking for a supply of aluminium that is high quality, reliable and low cost are unlikely to be pleased with the outcome of this decision.